Competition from specialty hospitals promotes high-quality patient care

May 26 2005

Specialty hospitals provide quality care to patients by offering new choices, and this hospital competition should not be stifled, the American Medical Association (AMA) testified to a subcommittee of the Senate Committee on Homeland Security and Governmental Affairs this week.

"The AMA believes that competition is absolutely vital to ensuring high-quality, cost-effective health care for America's patients," said AMA Trustee William Plested, MD. "Patients should continue to benefit from increased choice and competition that result from specialty hospitals.

"Focusing on a specific area of service can lead to higher quality and lower costs as a result of more expert and efficient care," said Dr. Plested. "The bottom-line: Specialty hospitals improve the quality of care for patients."

A new Centers for Medicare and Medicaid Services (CMS) study found lower mortality rates at all specialty hospitals. At specialty heart hospitals, the study found lower rates of complications such as infection, hip fractures, blood clots and sepsis. Quality measures at specialty heart hospitals were equal to or better than general hospitals.

While general hospitals have expressed concerns about competing with specialty hospitals, the committee that advises Congress on Medicare, MedPAC, found that general hospitals that compete with specialty hospitals have financial performance comparable to other general hospitals.

The AMA called for an end to the moratorium on physician referrals to specialty hospitals, and also called for changes in hospital payments to more accurately reflect the cost of care and to eliminate reliance on higher paying services to subsidize other care. "The answer is to support competition and eliminate cross-subsidization of services," said Dr. Plested.

"While these payment and policy changes take effect, the government should continue to monitor specialty hospitals and their impact on general hospitals and patient care, not stifle healthy competition," said Dr. Plested.